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Despite a 9.4 million decline in the overall telephone subscriber numbers in the wireless segment in January 2022, analysts say that India’s active subscriber base continues to grow. The share of active subscribers is at a three-year high at 88 per cent, according to the equity research firm Jefferies.
Analysing the latest telecom subscription data compiled by the Telecom Regulatory Authority of India, Jefferies also noted that in January 2022, the addition of active subscribers accelerated to 5.9 million month-on-month (m-o-m) “which indicates the acceptance of new tariffs”.
Active subscriber addition was led by Reliance Jio at 4.2 million, followed by Bharti Airtel at 1.3 millionwhile Vodafone Idea’s subscriber losses moderated to 0.6 million m-o-m. Jio cleaning up its inactive subscriber base has contributed the most to boosting India’s active subscriber share overall.
“Sector’s reported subscriber base fell by 9.4 million in January 2022, driven by the 9.3 million declines for Jio. A decline in reported subscribers amidst rising active subscribers has resulted in the sector’s active subscriber share rising to 88 per cent — to an almost threeyear high,” said Jeffries.
Jio’s numbers
Over the past six months, while Jio has added 22 million active subscribers, it has also de-recognised 59 million inactive subscribers, due to which its share of active subscribers has increased by 13 per cent to 91 per cent. Experts suggest that the telecom sector’s active subscriber base has almost reverted to pre-Covid levels, nearing the levels seen in early 2019.
According to the Jefferies report, Jio has 38 million inactive subscribers left in their base overall, thus their subscriber cleanup is likely to not continue for long.
Regarding the sector’s overall immunity to the tariff hikes, an expert said, “Telecommunications remains an essential service, thus the only area where consumers will feel a pinch is for their second sim, or underutilised plan, that they will choose to discontinue as tariff rates increase. 4G users do not have many options to downgrade, thus will continue to pay higher rates.”
Regarding Jio’s cleanup of inactive subscribers, an expert told BusinessLine on condition of anonymity, “As Jio consolidates its market position, it is moving to make its subscriber base of a higher quality. Subscriber cleanup improves its average revenue per user, and also serves as an indicator that the largest telco has a robust network.”
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